Construction Outlook for 2013 Improves

Construction Ahead Sign

According to the construction outlook survey results released from the ACG of America, “Significantly more construction firms are planning to add new staff than plan to cut staff, while demand for many types of private sector construction projects should increase this year”.  While the outlook for construction firms in the nation overall is optimistic for 2013, North Carolina’s survey results were a little different.   The vast majority at 85 percent do not believe the construction market will grow again until 2014 or later, with 35 percent expecting 2016 to be the earliest it will grow.  The majority believe that the available dollar volume of projects in 2013 will be lower or about the same for all sectors, except for higher education.

As far as new jobs in the construction industry in 2013, 72 percent will either add employees or they don’t know yet; only 8 percent plan to lay off employees.  The survey results also showed that construction firms do not plan on investing in any more capital in 2013 than they did in 2012, and if anything, they plan to invest less.  Possibly the reason construction firms plan to invest less, is because they expect their costs to rise in 2013.  An overwhelming 72 percent expect the cost of providing health care insurance to their employees to increase in 2013, and 86 percent estimated the price of construction material prices would increase as well.  With these increasing costs, 68 percent plan to keep their bid prices where profits are the same.

Overall, the North Carolina survey results for construction firms seem to be neither optimistic nor pessimistic.  Firms are being a little more cautious this year due to expectations of higher costs with the volume of projects in 2013 being about the same.  On a positive note, N.C. construction firms do plan to hire more employees this year, despite the rising costs, so maybe they are a little more optimistic than the survey reveals.